Goldman Sachs unveiled last Tuesday a new MBS valuation methodology that it claims more accurately assesses MBS - taking into account movements in other markets, such as agency debt and swaps, as well as volatility in underlying benchmarks. The new model went live last Thursday on the firm's external client website.

"The model combines an updated prepayment model with mortgage rate and term structure models to capture the interaction of mortgage valuations with other fixed-income markets in an arbitrage-free manner," the bank said in a prepared statement. The new model is unofficially called the Goldman Mortgage Valuation Model.

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